The US card issuer has tied up with Venture Infotek, an Indian credit card processing company, which will result in merchant outlets accepting Discover's cards growing more than 14 times to 1.77 lakh establishments.

While Discover cards will not be launched in India soon, Diners Club cards, which was acquired by Discover Financial last year, will benefit because of the increased acceptance. The US group has tied up with Venture Infotek for card acceptance, through Diner Club International, a business unit which it had acquired last year. The move would also Diners Club and Discovery cardholders to use their cards in a host of terminals across the country.

Earlier, Diners Club cards were accepted in only around 12,000 terminals across the country. The tie-up would now improve the card acceptance to over 172,000 terminals out of the total 470,000 terminals in the country. Discover Financial Services had bought Diners Club International from Citigroup last year.

In India, however, Citi is currently the exclusive franchisee for the card in India. The card base in India is said to be around 1.5 lakh, of which around 70% are corporate customer and the remaining individual customers who are high net worth individuals.

"We are going global in building our network. India is one of the first few countries where we have signed the merchant acceptance agreement. We are doing similar deals in Europe," points Harit Talwar, EVP and chief marketing officer, Discover Financial Services.

Currently, Discover processes around $200 billion of transactions a year. Of these, around 85% are in the US itself. Adds Venture Infotek MD Piyush Khaitan: "To start with, the cards would be initially accepted in the higher end hotels and shops in the major metros. It will be then installed in destination markets (tourists locations) such as Agra, Goa and other towns." US travellers in India carrying Discover cards will benefit from the increase in the number of merchant establishments accepting their cards.

There is a possibility that Discover may tie in with other banks to issue Diners cards to increase its card base in the country. However, Mr Talwar was non-committal on the exclusivity period with Citi or about the talks with other banks.

"We are always in conversation with partners in India and around the world. As of now, we have an exclusive arrangement with Citi, said Mr Talwar. The card base of Diners in the country has stagnated, even as rivals like Visa and MasterCard have seen a sharp growth. One of the main reasons has also been the lack of acceptance, which Discover is now trying to rectify by tying up with merchant groups such as Venture Infotek.